Misgovernance & low growth

ECONOMISTS agree that cities are the primary engines of economic growth. All our development partners have been telling us that, without addressing Karachi’s infrastructure issues, Pakistan cannot achieve its growth targets. On Aug 29, 2025, this newspaper published my article on how Karachi has been deprived of its rightful share of more than Rs3 trillion since 2010. Had that amount been spent on Karachi, we would not have reached this chaotic situation. With Karachi’s consistent neglect, Pakistan has been suffering from a low average growth syndrome since 2010. The Prime Minister’s Economic Transformation Agenda and Implementation Plan (2024-29) sets a growth target of six per cent. In the first year of the plan, we achieved only 2.7pc. Pakistan will continue to remain in a low-growth quagmire unless it improves the infrastructure of its growth engine, Karachi, which contributes 50pc of the country’s exports and handles 76pc of its trade. Let’s check one issue that has become critical to its population and industry: water. Most of us, including our most vocal political leadership, are under the impression that the completion of the Greater Karachi Water Supply Scheme (K-IV) will resolve the city’s water crisis. They are overlooking the fact that the Sindh government has turned K-IV, a water supply project, into a highly complex and insoluble inter-provincial issue. Given the Sindh government’s reluctance to provide funds for K-IV since 2007, the federal government took up the matter in December 2014, and former prime minister Nawaz Sharif directed that K-IV be completed within three years. In January 2015, the media reported that Bilawal Bhutto-Zardari directed the provincial government to resolve Karachi’s water shortage “on an emergency basis” and complete K-IV at the earliest. But even after 11 years, there is no sign of K-IV’s completion. The Sindh government is also moving at a snail’s pace on the augmentation project for water distribution pipelines, which has been pending since 2016. Even if by any chance K-IV is completed and the augmentation of pipelines carried out, Karachi’s water issue won’t be resolved. Why? Karachi needs 1,200-1,300 MGD (million gallons per day) of water. However, it gets roughly 550 MGD from Keenjhar Lake and 100 MGD from Hub Dam. The fact that most of this water reaches consumers through water tankers is another issue. The shortage is estimated to be 650 MGD or roughly 50pc of Karachi’s needs. Ironically, the provincial government has also been refusing to provide additional water for Karachi out of Sindh’s share in the Indus Water Accord and has approached the Indus River System Authority for a separate allocation to increase the supply to Karachi from 1,200 cusecs (roughly 775 MGD) to 2,400 cusecs (roughly 1,550 MGD). Irsa reminded Sindh that the IWA signed by the four provinces specifically mentions that Sindh’s allocation includes water for Karachi’s urban and industrial use and that such supplies for the metropolitan city will be given priority. The Sindh government was supposed to abide by the accord’s specific provisions and develop infrastructure to provide water for Karachi from its own allocation rather than seeking it from the share of the other provinces. Has any other province ever asked Irsa for separate water allocation for its cities or the federal government to provide funds? After failing to convince Irsa on the issue (in 2004, 2011 and 2015), the Sindh government decided to reduce the planned capacity of K-IV by 390 MGD — from 650 MGD to 260 MGD — till such time Irsa separately allocates water for Karachi. For this curtailed project of 260 MGD, the Sindh government will line the K.B. Feeder Canal (a project which has yet to begin), and the water saved from seepage will be provided for K-IV (Phase I). So, the present K-IV project is a curtailed version; even if it is completed, it will only solve one-third of the problem. Let’s check how much 390 MGD or 600 cusecs being denied to Karachi comes to: just 0.9pc of Sindh’s water resources of 67,000 cusecs. When I served as project director for the National Programme for Improvement of Watercourses, we lined around 13,000 watercourses in Sindh within three years (2004-2007), saving an estimated 13,000 cusecs of water seepage. Such is the negligible volume of 600 cusecs required for Karachi. The city of 25m people (almost 40pc of Sindh) has been made to beg the federal government for funds for K-IV (amounting to only 4pc of Sindh’s annual development programme) and ask other provinces for water (for only 0.9pc of Sindh’s resources). For 1,000 gallons of water, the agricultural landowners (using 95pc of the water resources of Sindh) pay only 20 paisas compared to a tanker in Karachi which costs Rs1,000 for the same quantity. In short, whenever the curtailed K-IV and pipeline augmentation are completed (an eternity, it seems), these won’t be sufficient to cater for even one-third of the city’s needs. There seems to be no intention on the part of the Sindh government to even start designing the remaining part of K-IV as it is not ready to give 0.9pc of its water share, and is, instead, waiting for Irsa to allocate water for Karachi. Meanwhile, Irsa says that it deals with provincial shares, not cities’ shares. Karachi pays 90pc of Sindh’s taxes and 60pc of federal taxes, yet it has not received its rightful share of more than Rs3tr since 2010 from the Sindh government, the NFC beneficiary. The IWA provides for preferential treatment for Karachi’s water needs, but the Sindh government won’t abide by it even if it means only a tiny fraction of the province’s water resources. Then what is the logical solution to these issues that are impeding national growth, while also contributing to the unending misery of Karachi’s residents? The writer is former federal secretary, caretaker provincial minister and currently chairman, Policy Research and Advisory Council. Published in Dawn, December 31st, 2025